yeah, thats right, should just grab some new pads and bleed the system and put some new fluid in. if its still spongey after that there's something wrong (maybe rotors have had it) but i doubt it.
keep in mind if you want some real good brakes, vt twin piston calipers and 293mm slotted rotors are only around $400 (a pair), with braided lines and pads included.